Doctrine: a plaintiff’s motion to dismiss under Rule 17, when granted, does not cover counterclaims filed by the
defendant, should the defendant wish to continue ventilate his counterclaims in the same action.
G.R. No. 155701, March 11, 2015
LIM TECK CHUAN, Petitioner, v. SERAFIN UY AND LEOPOLDA CECILIO, LIM SING CHAN @
HENRY LIM, Respondents.
DECISION
REYES, J.:
Antonio Lim Tanhu (Antonio) owned a lot which he later sold to Spouses Cabansag. This lot was situated
in Barrio Agus, Lapu-lapu City, Cebu. Then, Spouses Cabansag sold the lot to Serafin, as evidenced by a Deed of
Sale. To pave the way for the transfer of title to Serafin’s name, Spouses Cabansag attempted to have the same
transferred under their names first. However, Francisco failed to do so as he lost the owner’s copy of TCT No. T-
0500 together with other documents pertaining to the sale of the subject lot. This prompted Serafin to exert efforts
to secure copies of the lost documents himself. On May 15, 1996, Serafin filed a petition before the RTC, docketed
as Cadastral Case No. 21 praying for the issuance of a new owner’s duplicate TCT in his name, thereby cancelling
TCT No. T-0500 in the name of Antonio.
However, the aforesaid order was recalled and nullified on September 3, 19967 on the ground that the petitioner
filed an Opposition and/or Motion for Reconsideration with Manifestation for Special Appearance 8 dated August
22, 1996 alleging that he is one of the six legitimate descendants of Antonio; and that the original owner’s copy of
TCT No. T-0500 was not lost and has always been in his custody.
In the meantime, on August 2, 1996, Lim Sing Chan alias Henry Lim (Henry) executed an Affidavit of Sole
Adjudication/Settlement of the Estate of Antonio Lim Tanhu with Deed of Sale 9 (Affidavit of Self-Adjudication)
claiming that he is the only surviving heir of Antonio. In the same document, Henry sold Lot 5357 to Leopolda in
the amount of P500,000.00.
With this turn of events, Serafin filed on July 25, 1997 a complaint before the RTC, against Leopolda, Henry, and
the herein petitioner. The petitioner averred in his Answer12 (with counterclaim, and cross-claims against Leopolda
and Henry), that Lot 5357 was never transferred nor encumbered to any person during Antonio’s lifetime. The deed
of sale in favor of Spouses Cabansag was simulated and spurious, and was intended to defraud the estate of Antonio.
Later, Serafin and Leopolda submitted a Joint Motion to Dismiss, stating among others that they have amicably
settled their differences in the case at bench. And that That whatever claim defendant Lim Teck Chuan may have on
said Lot No. 5357, the same may be ventilated by said defendant in an appropriate independent action that he may
initiate and file.
Petitioner filed his opposition on the motion to dismiss on ground of bad faith. He wanted to continue the
proceedings for his counterclaims and the crossclaims.
RTC granted the motion to dismiss.
Before SC, the petitioner faults the RTC for dismissing the case in its entirety in spite of his counterclaim and cross-
claim. Pursuant to the provisions of Section 2, Rule 17 of the Rules of Court, his timely expression of such
preference should be enough for the trial court not to dismiss the case in its entirety, and to limit its action to the
dismissal of the complaint.
Issue: Whether or not RTC erred in dismissing the entire case based on the plaintiff’s motion to dismiss, which is
contrary to Sec. 2, Rule 17?
Held: Yes, it did.
As can be gleaned from the assailed orders, the RTC erred when it dismissed the case when the present rules state
that the dismissal shall be limited only to the complaint. A dismissal of an action is different from a mere dismissal
of the complaint. For this reason, since only the complaint and not the action is dismissed, the defendant in spite of
said dismissal may still prosecute his counterclaim in the same action. 40 The case of Pinga v. Heirs of German
Santiago41 is quite instructive which this Court finds worth reiterating. In Pinga, the Court clearly stated that the
dismissal of the complaint does not necessarily result to the dismissal of the counterclaim.
In the instant case, the petitioner’s preference to have his counterclaim (and cross-claims) be prosecuted in the same
action was timely manifested.
